When a couple separates, the topic of finances can often be fraught with tension. This tension usually increases where children and split costs are involved.
So, who is responsible for what expenses after a divorce, and what can you do if the other parent is not paying their share?
Does the parent with sole or majority custody have to pay for all of the child’s expenses?
There is no one-size-fits-all formula for deciding who has to pay for expenses like school fees and extra-curricular activities, or in what proportion. These types of arrangements will need to be discussed and agreed upon between the parents. If no agreement can be reached, then either parent may apply for a Child Support Assessment, which will determine each parent’s financial obligation to maintain their child/ren. Child Support will not necessarily cover all expenses for your child, such as extra-curricular activities, and may require further discussion between parents.
Should child support be used to cover school fees?
Technically each parent’s obligation to financially support their child is limited to the child support they are assessed to pay. Child support is calculated using a formula that considers the amount of time the child spends with each parent and both parents’ income. In reality, most parents have a separate informal agreement about how they will share other child-related expenses, such as school fees and extra-curricular activities, particularly if children are enrolled in private schooling and expensive activities that both parents which the children to continue to enjoy.
It is possible if you have reached an informal agreement as to the amount of child support to be paid, to formalise that agreement into a Limited or Binding Child Support Agreement.
What if I can’t reach an agreement with my ex-partner about who pays for our children's expenses?
Having to adapt to a single income after living with dual incomes can be a huge adjustment, particularly if both parents are now responsible for their own mortgages/rent as opposed to one shared mortgage/rent. Other costs may arise that you did not realise would be as much of a burden as a single parent as they were when you had a joint income, such as weekends away or birthdays.
Often during separations and divorce, one parent will try to ‘punish’ the other by refusing to pay for an extracurricular activity or the school fees, or by insisting the child is removed from the school and enrolled elsewhere, however, it is crucial that both parents try to work together so that their children remain as unaffected as possible and do not become collateral damage as a result of the separation. The children’s emotional well-being should always take priority.
If an agreement about who should foot the bill for certain expenses cannot be reached, mediation may be useful. Mediation is run by a neutral third party who can help to effectively draw out the most important issues while avoiding aggression and conflict. Mediation relating to expenses can see former couples come away with a fair, mutually-agreed plan for paying for expenses like school fees, medical treatments, and extra-curricular activities.
Where agreement cannot be reached, a Child Support Assessment will determine financial responsibility. Child Support has the authority to determine who is responsible for the payment of expenses like school fees and make a ruling on the matter. There is a review process available to parents who have taken this route but do not agree with the ruling.
In some limited circumstances, it may also be possible to seek a determination by a Court as to Child Support. Child Support may also be negotiated as part of your property settlement following your separation.
If you are a parent who has separated and you require assistance with Child Support, our family lawyers can help guide you through your options. Give our experienced team a call on (07) 4052 0700.